Zheng v Cai

The High Court of Australia considered a dispute between Mr Zheng and Ms Cai concerning the ownership of a property. The central issue revolved around whether Ms Cai had acquired a beneficial interest in the property, which was registered solely in Mr Zheng's name, through a resulting or constructive trust.

The High Court was required to determine whether the evidence established that Ms Cai had contributed to the purchase price of the property in circumstances that would give rise to a resulting trust in her favour. Further, the Court had to consider whether, in the alternative, the conduct of the parties and the circumstances surrounding the acquisition and subsequent management of the property gave rise to a constructive trust, either by common intention or unconscionability.

The Court analysed the principles of resulting and constructive trusts in the context of property ownership. It was held that for a resulting trust to arise, there must be evidence of a direct contribution to the purchase price, or to the discharge of a mortgage, at the time of acquisition. In this instance, the Court found that Ms Cai had not made such a direct financial contribution. However, the Court also examined the doctrine of common intention constructive trusts, which requires evidence of a common intention that the beneficial interest in the property would be shared, and that the party seeking to establish the trust acted to their detriment in reliance on that intention. The Court found that the evidence did not support a common intention that Ms Cai would have a beneficial interest in the property.

The High Court ultimately dismissed the appeal, finding that neither a resulting nor a constructive trust had been established on the facts presented.